Determining the value of financial advice in the wake of the Royal Commission

By Erryn Worth
National Communication and Marketing Manager
(Centrepoint Alliance)

In the wake of the Royal Commission (RC), many clients want answers about what’s going on in the industry. This is understandable as findings from the RC have highlighted many of the industry’s shortcomings.

However, it would be amiss to buy into the narrative being played out that suggests all financial advisers lack the competency to provide their clients with life-changing advice. In fact, for most financial advisers, the RC is a welcome disruption to help change some of the negative culture within the industry.

The intangible value of advice 8.7 million Australians have unmet financial advice needs and 2.5 million of this segment will seek out financial advice in the next two years1 (see infographic). But what is it they’re looking for exactly and how can financial advisers step in to help?

According to the Value of Advice Report (2017) by SunSuper, financial stress is considerably affecting people’s lives, with health and family relationships being impacted the most (see infographic). This is where advisers can step in to help give you peace of mind. Financial advisers spend time getting to know you and your financial goals and are often one of the closest professional relationships you’ll have. Armed with this level of personal insight, advisers are able to have a real and demonstrable impact on the quality of your life. In an IOOF survey2 of 521 advised and non-advised participants, advised participants reported an overall increase in peace of mind by as much as 21% once they had received advice.

The importance of professional financial advice While the industry is going through a hard time at the moment, it’s important not to underestimate the importance of professional financial advice and the role it can play in transforming lives.

As Andrew Inwood of market research consultancy, CoreData, states, there are two things he can be certain of:

  • If you have a close relationship with your financial adviser, you will be richer than someone who doesn’t have a close relationship with their financial adviser.
  • If you have a close relationship with your financial adviser, you will be more confident about the future than someone who doesn’t.

1 SunSuper. 2017. Value of Advice Report. Available at: https://sunsuper.i-events.info/pub/pubType/EO/pubID/ zzzz59cc2ead08b46896/interface.html

2 IOOF. 2015. The true value of advice. Available at: https://www. ioof.com.au/financial-advice/understanding-financial-advice/how financial-advice-can-help

0

Like This